Contracting and Tax Accountability Act of 2019

II 116TH CONGRESS 1ST SESSION S. 1385 To prohibit the awarding of a contract or grant in excess of the simplified acquisition threshold unless the prospective contractor or grantee certifies in writing to the agency awarding the contract or grant that the con- tractor or grantee has no seriously delinquent tax debts, and for other purposes. IN THE SENATE OF THE UNITED STATES MAY 9, 2019 Mr. KENNEDY introduced the following bill; which was read twice and referred to the Committee on Homeland Security and Governmental Affairs A BILL To prohibit the awarding of a contract or grant in excess of the simplified acquisition threshold unless the prospec- tive contractor or grantee certifies in writing to the agen- cy awarding the contract or grant that the contractor or grantee has no seriously delinquent tax debts, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Contracting and Tax 4 Accountability Act of 2019’’. 5 VerDate Sep 11 2014 04:16 May 17, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S1385.IS S1385 kjohnson on DSK79L0C42 with BILLS 2 •S 1385 IS SEC. 2. GOVERNMENTAL POLICY. 1 It is the policy of the United States Government that 2 no Government contracts or grants should be awarded to 3 individuals or companies with seriously delinquent Federal 4 tax debts. 5 SEC. 3. DISCLOSURE AND EVALUATION OF CONTRACT OF- 6 FERS FROM DELINQUENT FEDERAL DEBT- 7 ORS. 8 (a) IN GENERAL.—The head of any executive agency 9 that issues an invitation for bids or a request for proposals 10 for a contract in an amount greater than the simplified 11 acquisition threshold shall require each person that sub- 12 mits a bid or proposal to submit with the bid or proposal 13 a form— 14 (1) certifying that the person does not have a 15 seriously delinquent tax debt; and 16 (2) authorizing the Secretary of the Treasury to 17 disclose to the head of the agency information lim- 18 ited to describing whether the person has a seriously 19 delinquent tax debt. 20 (b) IMPACT ON RESPONSIBILITY DETERMINATION.— 21 The head of any executive agency, in evaluating any offer 22 received in response to a solicitation issued by the agency 23 for bids or proposals for a contract, shall consider a certifi- 24 cation that the offeror has a seriously delinquent tax debt 25 to be definitive proof that the offeror is not a responsible 26 VerDate Sep 11 2014 04:16 May 17, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S1385.IS S1385 kjohnson on DSK79L0C42 with BILLS 3 •S 1385 IS source as defined in section 113 of title 41, United States 1 Code. 2 (c) DEBARMENT.— 3 (1) REQUIREMENT.—Except as provided in 4 paragraph (2), the head of an executive agency shall 5 initiate a suspension or debarment proceeding 6 against a person after receiving an offer for a con- 7 tract from such person if— 8 (A) such offer contains a certification (as 9 required under subsection (a)(1)) that such per- 10 son has a seriously delinquent tax debt; or 11 (B) the head of the agency receives infor- 12 mation from the Secretary of the Treasury (as 13 authorized under subsection (a)(2)) dem- 14 onstrating that such a certification submitted 15 by such person is false. 16 (2) WAIVER.—The head of an executive agency 17 may waive paragraph (1) with respect to a person 18 based upon a written finding of urgent and compel- 19 ling circumstances significantly affecting the inter- 20 ests of the United States. If the head of an executive 21 agency waives paragraph (1) for a person, the head 22 of the agency shall submit to Congress, within 30 23 days after the waiver is made, a report containing 24 VerDate Sep 11 2014 04:16 May 17, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S1385.IS S1385 kjohnson on DSK79L0C42 with BILLS 4 •S 1385 IS the rationale for the waiver and relevant information 1 supporting the waiver decision. 2 (d) RELEASE OF INFORMATION.—The Secretary of 3 the Treasury, in consultation with the Director of the Of- 4 fice of Management and Budget, shall make available to 5 all executive agencies a standard form for the authoriza- 6 tion described in subsection (a). 7 (e) REVISION OF REGULATIONS.—Not later than 270 8 days after the date of enactment of this subsection, the 9 Federal Acquisition Regulation shall be revised to incor- 10 porate the requirements of this section. 11 SEC. 4. DISCLOSURE AND EVALUATION OF GRANT APPLI- 12 CATIONS FROM DELINQUENT FEDERAL 13 DEBTORS. 14 (a) IN GENERAL.—The head of any executive agency 15 that offers a grant in excess of an amount equal to the 16 simplified acquisition threshold shall require each person 17 applying for a grant to submit with the grant application 18 a form— 19 (1) certifying that the person does not have a 20 seriously delinquent tax debt; and 21 (2) authorizing the Secretary of the Treasury to 22 disclose to the head of the executive agency informa- 23 tion limited to describing whether the person has a 24 seriously delinquent tax debt. 25 VerDate Sep 11 2014 04:16 May 17, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S1385.IS S1385 kjohnson on DSK79L0C42 with BILLS 5 •S 1385 IS (b) IMPACT ON DETERMINATION OF FINANCIAL STA- 1 BILITY.—The head of any executive agency, in evaluating 2 any application for a grant offered by the agency, shall 3 consider a certification that the grant applicant has a seri- 4 ously delinquent tax debt to be definitive proof that the 5 applicant is high-risk and, if the applicant is awarded the 6 grant, shall take appropriate measures under guidelines 7 issued by the Office of Management and Budget for en- 8 hanced oversight of high-risk grantees. 9 (c) DEBARMENT.— 10 (1) REQUIREMENT.—Except as provided in 11 paragraph (2), the head of an executive agency shall 12 initiate a suspension or debarment proceeding 13 against a person after receiving a grant application 14 from such person if— 15 (A) such application contains a certifi- 16 cation (as required under subsection (a)(1)) 17 that such person has a seriously delinquent tax 18 debt; or 19 (B) the head of the agency receives infor- 20 mation from the Secretary of the Treasury (as 21 authorized under subsection (a)(2)) dem- 22 onstrating that such a certification submitted 23 by such person is false. 24 VerDate Sep 11 2014 04:16 May 17, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S1385.IS S1385 kjohnson on DSK79L0C42 with BILLS 6 •S 1385 IS (2) WAIVER.—The head of an executive agency 1 may waive paragraph (1) with respect to a person 2 based upon a written finding of urgent and compel- 3 ling circumstances significantly affecting the inter- 4 ests of the United States. If the head of an executive 5 agency waives paragraph (1) for a person, the head 6 of the agency shall submit to Congress, within 30 7 days after the waiver is made, a report containing 8 the rationale for the waiver and relevant information 9 supporting the waiver decision. 10 (d) RELEASE OF INFORMATION.—The Secretary of 11 the Treasury, in consultation with the Director of the Of- 12 fice of Management and Budget, shall make available to 13 all executive agencies a standard form for the authoriza- 14 tion described in subsection (a). 15 (e) REVISION OF REGULATIONS.—Not later than 270 16 days after the date of the enactment of this section, the 17 Director of the Office of Management and Budget shall 18 revise such regulations as necessary to incorporate the re- 19 quirements of this section. 20 SEC. 5. DEFINITIONS AND SPECIAL RULES. 21 For purposes of this Act: 22 (1) PERSON.— 23 (A) IN GENERAL.—The term ‘‘person’’ in- 24 cludes— 25 VerDate Sep 11 2014 04:16 May 17, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S1385.IS S1385 kjohnson on DSK79L0C42 with BILLS 7 •S 1385 IS (i) an individual; 1 (ii) a partnership; and 2 (iii) a corporation. 3 (B) EXCLUSION.—The term ‘‘person’’ does 4 not include an individual seeking assistance 5 through a grant entitlement program. 6 (C) TREATMENT OF CERTAIN PARTNER- 7 SHIPS.—A partnership shall be treated as a 8 person with a seriously delinquent tax debt if 9 such partnership has a partner who— 10 (i) holds an ownership interest of 50 11 percent or more in that partnership; and 12 (ii) has a seriously delinquent tax 13 debt. 14 (D) TREATMENT OF CERTAIN CORPORA- 15 TIONS.—A corporation shall be treated as a 16 person with a seriously delinquent tax debt if 17 such corporation has an officer or a shareholder 18 who— 19 (i) holds 50 percent or more, or a con- 20 trolling interest that is less than 50 per- 21 cent, of the outstanding shares of cor- 22 porate stock in that corporation; and 23 (ii) has a seriously delinquent tax 24 debt. 25 VerDate Sep 11 2014 04:16 May 17, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S1385.IS S1385 kjohnson on DSK79L0C42 with BILLS 8 •S 1385 IS (2) EXECUTIVE AGENCY.—The term ‘‘executive 1 agency’’ has the meaning given such term in section 2 133 of title 41, United States Code. 3 (3) SERIOUSLY DELINQUENT TAX DEBT.— 4 (A) IN GENERAL.—The term ‘‘seriously de- 5 linquent tax debt’’ means a Federal tax liability 6 that— 7 (i) has been assessed by the Secretary 8 of the Treasury under the Internal Rev- 9 enue Code of 1986; and 10 (ii) may be collected by the Secretary 11 by levy or by a proceeding in court. 12 (B) EXCEPTIONS.—Such term does not in- 13 clude— 14 (i) a debt that is being paid in a time- 15 ly manner pursuant to an agreement under 16 section 6159 or section 7122 of such Code; 17 (ii) a debt with respect to which a col- 18 lection due process hearing under section 19 6330 of such Code, or relief under sub- 20 section (a), (b), or (f) of section 6015 of 21 such Code, is requested or pending; 22 (iii) a debt with respect to which a 23 continuous levy has been issued under sec- 24 tion 6331 of such Code (or, in the case of 25 VerDate Sep 11 2014 04:16 May 17, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S1385.IS S1385 kjohnson on DSK79L0C42 with BILLS 9 •S 1385 IS an applicant for employment, a debt with 1 respect to which the applicant agrees to be 2 subject to such a levy); and 3 (iv) a debt with respect to which such 4 a levy is released under section 5 6343(a)(1)(D) of such Code. 6 SEC. 6. EFFECTIVE DATE. 7 This Act shall apply with respect to contracts and 8 grants awarded on or after the date occurring 270 days 9 after the date of the enactment of this Act. 10 Æ VerDate Sep 11 2014 04:16 May 17, 2019 Jkt 089200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6301 E:\BILLS\S1385.IS S1385 kjohnson on DSK79L0C42 with BILLS